Special Report: Thomson Resources has made what it describes as a transformational acquisition, picking up two prospective silver deposits in New South Wales.

The NSW focused explorer Thomson (ASX:TMZ) has signed a binding term sheet with Silver Mines Limited to acquire 100 per cent of the Webbs and Conrad silver projects, covering 86sqkm of highly prospective land in the New England Fold belt.

Both projects have a history of high-grade silver production, with each boasting resources defined compliant with JORC 2004 standards.

The Webbs project offers what Thomson believes to be some of the highest grades of any undeveloped silver project in the nation, with the JORC 2004 resource coming in at 1.5 million tonnes at 345 grams per tonne silver equivalent, for some 16.5 million ounces of silver equivalent.

Thomson has also identified significant exploration upside with several down-plunge extensions open at depth. The remainder of the tenement is largely underexplored.

At Conrad, the JORC 2004 resource measures 2.65 million tonnes at 206 g/t silver equivalent for 17.5 million ounces of silver equivalent.

Previous exploration at Conrad has predominantly focused on the main Conrad line of lode, and the company said there was considerable exploration potential to expand beyond the current known mineralised zone.

Thomson Resources
Historic mine infrastructure at Webbs.

Thomson executive chairman David Williams said the term sheet was a transformational moment for the company.


“With these acquisitions Thomson has added an additional layer of diversification to its existing high quality exploration portfolio, and with a focused effort Thomson will be able to quickly move into becoming a silver producer,” he said.

The deal will be funded via an up-front payment of $50,000, the payment of cash rehabilitation bonds, and the issue of shares and options in Thomson. On completion, Silver Mines will hold a 19 per cent stake in Thomson and its managing director Anthony McClure will join the company’s board as a non-executive director.

Mr McClure said the projects would move into good hands, allowing Silver Mines to focus on the development of its Bowdens silver project.

“The concentrated effort which Thomson will be able to afford these highly prospective assets will be particularly interesting, and it is a great outcome for Silver Mines to be able to maintain exposure to these assets via its equity interest in Thomson under the terms of the agreement,” he said.

The acquisition will complement the company’s existing portfolio of highly prospective gold assets, with drilling currently underway at the Chillagoe gold project and expected to begin shortly at the Yalgogrin and Harry Smith gold projects.


Drumming up funds

In addition to the acquisition, Thomson announced it had received firm commitments from institutional and sophisticated investors to raise $6 million through a share placement at 6.2c per share.

The proceeds from the placement will be used to continue exploration activities over the company’s existing projects, as well as new projects in NSW and Queensland, according to Mr Williams.

“We have been working hard on building the company’s momentum which started in June 2020, and our rebuilding of an active work program,” he said.

“This has been reflected in the market’s growing appreciation of the company. Strong interest in this capital raising, which was oversubscribed, is testament to the company’s existing portfolio and the quality of the silver projects being acquired.”


A rich history of production

Both Webbs and Conrad have a long and storied history, with the former discovered in 1884. Between then and 1901, around 55,000 tonnes of ore were mined at an average grade of at least 23 ounces per tonne silver. At Webb’s Main, mining reached some 210m below surface and extracted a high-grade south-plunging chute.

The Conrad project was historically one of the largest silver producers in the New England region, pumping out about 3.5 million ounces of silver production from around 175,000 tonnes of ore during its original time. Production started at Conrad in 1891 and continued to 1912, before recommencing in 1947 and taking place intermittently through to 1957.

Thomson Resources
A historic photograph of the King Conrad shaft. Pic: Supplied

Thomson will be working to revive each to output levels reminiscent of their glory days.





This article was developed in collaboration with Thomson Resources, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.